Finland's VR Group cuts freight rail traffic with Russia to 35%, plans to leave market by year's end
MOSCOW. Oct 25 (Interfax) - VR Group had curtailed 65% of freight rail traffic with Russia by the end of September 2022, the Finnish railway company reported.
The company said it plans to completely discontinue freight traffic with Russia by the end of this year. It expects some of the losses in eastern traffic to be offset by the growth of domestic demand.
VR Group's overall freight traffic fell 20% year-on-year in the third quarter of 2022 due to the discontinuation of traffic with Russia. The company also expects freight traffic to decrease for the year as well.
VR Group still plans to sell its freight service affiliates and subsidiaries in Russia, such as ContainerTrans Scandinavia (CTS) and Freight One Scandinavia (FOS), and is also looking for a solution regarding its Russian logistics subsidiary Finnlog.
VR Group and Russian Railways (RZD) have a joint venture, Oy Karelian Trains Ltd, that was formed to provide passenger services between St. Petersburg and Helsinki on Allegro high-speed trains. Allegro services between the two cities were suspended on March 28. In the second quarter, VR Group wrote off all rolling stock and spare parts related to Allegro trains in the amount of 45.4 million euros.
VR Group net revenue from operations related to Russia amounted to about 91 million euros in 2021, or about 11% of the group's total net revenue.